The Leisure Industry is like a heavyweight boxer at times, pinned to the ropes, absorbing blow after blow. Covid lockdowns, enforced closures, soaring energy costs, transport strikes, declining consumer confidence – all of these blows are being absorbed. But, like a Heavyweight champion, the Leisure Industry continues to fight back.
Even now, as The Times of 18th January 2023 reports that the Government is seeking different language to describe their “levelling up” policy”, I argue that the Leisure Industry should be encouraged as a key foundation stone of the drive for economic recovery. And whatever they now call it, the Leisure Industry is a key part of the Government’s levelling up agenda.
In fact, all of this can be done with a small number of low cost and yet high impact interventions which can help to drive a balanced and thriving economy as the economy recovers. Securing the future of the Leisure Industry can play a major role in creating new jobs and economic growth, especially in the North and Midlands, and the South West.
A Significant Economic Contribution
To date, the Leisure Industry has not been acknowledged for its significant contribution to the UK economy, neither as a major employer nor as a catalyst for employment and youth employment growth. Government has a strong influence on the performance of the Leisure Industry, as it sets consumer taxes and duties, implements regulation and influences employment costs. Government therefore ultimately can make the difference between success, survival and failure for many leisure businesses.
In the past, and especially in the current climate, the focus seems to have been exclusively on taxing, regulating and controlling the sector, irrespective what this meant for the future of the Leisure Industry.
A Definition of the Leisure Industry
Just over ten years ago, I was Chief Executive of Business in Sport and Leisure (BISL). We commissioned an authoritative report into the future of the Leisure Industry, which set out a blueprint for how the Leisure Industry could be an engine for the economic growth of the country. Many of the recommendations of The BISL Oliver Wyman State of the UK Leisure Industry Report (2012) are relevant today and are worth consideration as we emerge from the current crisis.
For the first time, the BISL Oliver Wyman Report gave an authoritative definition of the Leisure Industry, a definition which overlaps with and is often interchangeable with the hospitality sector, of which there is much current discussion.
The definition which the Report was proposed was this;
“The ‘Leisure Industry’ provides services and products to consumers – business, families or individuals, domestic or foreign-to meet people’s demand for leisure opportunities, experiences and facilities, in particular for sport, culture, recreation, entertainment, eating and drinking, days and nights out, betting and gaming and accommodation”.
By adopting this definition, the Report found that the Leisure Industry is comparable in scale to the Retail and Transportation industries, although it is frequently disregarded from a policy perspective compared to these industries. The Report argued that, at this scale and, with this definition, the Leisure Industry is too important to remain under represented, misunderstood and underappreciated by the Government.
Major Employer
The Leisure Industry is a major employer in terms of numbers. But it also is a major contributor to the achievement of key Government economic growth objectives and able to make a significant social as well as economic impact.
It provides jobs for more 16-25 year olds than manufacturing, construction and Financial Services combined. Yet, these are the industries which Government economic plans are built upon.
The Leisure Industry has a strong female workforce, with the majority of the Leisure workforce being female and nearly half of management positions held by women. It attracts a large proportion of part time and flexible workers, with nearly half of employees in the Leisure Industry on part time or flexible contracts. And the Leisure Industry offers attractive career options for both skilled and unskilled workers, with few barriers to career progression and advancement.
Few other industries are as capable of providing jobs and flexible, career development opportunities for this diverse part of the workforce.
And it is one of the few industries that is genuinely spread around the country, in all regions. It is perfect for assisting a Government so determined to level up regional economies and supporting the regrowth of towns and cities outside London and the South East.
Repeating the Call
With this powerful contribution to the social and economic growth of the country, it is time to repeat our call from 10 years ago in the BISL Oliver Wyman State of the UK Leisure Industry Report for a renewed strategy for Government to secure the future of the Leisure Industry and help it improve its skill base, and encourage entrepreneurship, employment and innovation.
We encourage the Government to use the tax system to incentivise Leisure businesses to employ even more 16-25 year olds – the sector suffering the greatest detriment to employment prospects in the current economy.
It is right to call again for a controlled exemption from National Insurance Contributions for one year to any business which employs a 16-25 year old not otherwise in employment, education or training. The Leisure Industry will doubtless carry the load and ensure that this sector of the economy does not get left behind.
The Leisure Industry is able to be a powerful provider of apprenticeship and training opportunities. A time limited exemption from NIC’s, as argued above, could be coupled with an obligation on the Leisure employer to provide transferable training or apprenticeships. This is an innovative way to use the tax system to create employment and training incentives for employers.
There remains a benefit in reducing the licensing and regulatory red tape that restricts the growth of the sector, in particular restaurants, pubs, night clubs and betting and gaming businesses.
These measures will secure the future of the Leisure Industry and help it fulfil its potential to drive economic growth and to provide new jobs and career opportunities.
